Koch says developer shakeup doesn't change vision for downtown

Thomas Koch is facing perhaps his biggest hurdle in his six-plus years as mayor. His signature issue – saving Quincy Center – could take a big step back if the city cuts ties with its development partner in the $1.6 billion downtown redevelopment plan.

Koch said he started to doubt Street-Works around Thanksgiving, more than a month after the developer halted const...

» Read more

X

A few things the mayor had to say

On problems with Street-Works

Koch said he started to doubt Street-Works around Thanksgiving, more than a month after the developer halted construction on Merchants Row. Koch said investor LaSalle Investment Management pulled back $60 million in investment money, and it became clear Street-Works didn’t have its own capital to move project forward.

On Merchants Row

Koch said investor Quincy Mutual Fire Insurance plans to oversee Merchants Row as a private project, although the city must approve construction plans. Koch said Quincy Mutual is still trying to get control of the project from Street-Works.

On future partnerships with developers

Koch said the city probably won’t use one master developer for all of the downtown revitalization, originally expected to cover at least 12 blocks. He said the city will likely partner with developers “block by block,” and multiple projects could occur concurrently.

On union labor

Koch said the unions, like all parties involved in future plans, may not enjoy the same guarantees they had in the Street-Works deal. The deal required the developer to hire union workers for 80 percent of construction. “I think we need to be more creative going forward in how we get this done, and I think everyone has to come to the table,” the mayor said.

On communication with existing downtown businesses

Koch said communication during Street-Works’ partnership left room for improvement. “I think we can do things in a better way going forward,” he said.

QUINCY – Thomas Koch is facing perhaps his biggest hurdle in his six-plus years as mayor. His signature issue – saving Quincy Center – could take a big step back if the city cuts ties with its development partner in the $1.6 billion downtown redevelopment plan.

But Koch says the city has already made great strides downtown, and that he always expected to face setbacks in a project that no Quincy mayor before him had tried.

“It would have been very easy for me not to involve myself in the downtown. No blood; no foul,” Koch said Tuesday during an editorial board meeting at The Patriot Ledger’s offices. “There’s plenty else going on in the city we’ve been working on – whether it’s new construction, new schools, a senior center, a track, open spaces, intersection reconstruction – but I felt strongly, and I still feel strongly, that (downtown redevelopment) is the right thing to do.

“If it costs me an election, so be it,” he continued. “We’re going to continue to move the ball forward down the field.”

Koch said Street-Works has until March 21 to meet key project benchmarks – paying $1 million to go along with permitting plans and financial reports – or else he’ll consider seeking new development partners. Critics of the mayor have said this shakeup in the project calls into question the viability of Koch’s plans going forward.

“This business is not easy. I’m going to be looked at from many angles and with a lot of microscopes, and after the fact everybody always has the right answers,” Koch said. “The reality is, going into this, nobody had stepped up before. I’m proud of where we’ve come, and I know we’re going to get there. It won’t be the same plan, but it’ll be the same vision.”

Koch said he met with Street-Works partners Ken Narva and Richard Heapes last Thursday in what he described as a “cordial” discussion. The mayor didn’t want to discuss whether the developers expressed an intent to meet the benchmarks.

“I have to be very cognizant, as I have been advised by my legal team, that I can’t say a lot in the press,” Koch said.

No one from Street-Works has returned calls from The Patriot Ledger in recent weeks.

In the past several years, Koch’s administration has touted the city’s 2010 land-disposition agreement with Street-Works, calling it a city-friendly deal that ensures that no Quincy taxpayer money would be spent on the project until the developer first met key benchmarks that guaranteed new tax revenue.

Page 2 of 2 - In the land-disposition agreement, Street-Works agreed to pay back $30 million in city downtown debt. Now that debt appears headed back to the city.

Although much of the borrowed money, approved in 2007 under former Mayor William Phelan, went toward the construction of the Hannon Parkway Concourse, Koch said some of the money was spent during his tenure for downtown planning and toward preparing the 2010 agreement with Street-Works. Koch couldn’t give specifics on spending amounts.

Since 2007, Koch said, the city has paid several hundred thousand dollars per year in interest on the $30 million bond using taxpayer money and funds from the city’s meals tax. The bond principal, to be paid over 30 years starting in 2017, must be paid back using tax revenue from the city’s “urban renewal district” – the downtown area designated for redevelopment.

Koch said he is confident that new residential and retail buildings will be up and generating tax revenue by 2017. If need be, revenue from the meals tax will be used to help pay off the $30 million bond, he said.

“A lot of (the meals tax) is generated from that district,” Koch said.